Form 8-K/A

8-K/A — INNOVATIVE SOLUTIONS & SUPPORT INC

Accession: 0001104659-26-114137

Filed: 2026-10-07

Period: 2026-07-21

CIK: 0000836690

SIC: 7371 (SERVICES-COMPUTER PROGRAMMING SERVICES)

Item: Completion of Acquisition or Disposition of Assets

Item: Financial Statements and Exhibits

Documents

8-K/A — tm2626969d1_8ka.htm (Primary)

EX-23.1 — EXHIBIT 23.1 (tm2626969d1_ex23-1.htm)

EX-99.1 — EXHIBIT 99.1 (tm2626969d1_ex99-1.htm)

EX-99.2 — EXHIBIT 99.2 (tm2626969d1_ex99-2.htm)

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8-K/A — FORM 8-K/A

8-K/A (Primary)

Filename: tm2626969d1_8ka.htm · Sequence: 1

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0000836690

2026-07-21

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K/A

(Amendment No. 1)

CURRENT

REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

July 21, 2026

INNOVATIVE SOLUTIONS AND SUPPORT, INC.

(Exact name of registrant as specified in its charter)

Pennsylvania

001-41503

23-2507402

(State or other jurisdiction of Incorporation)

(Commission File Number)

(I.R.S. Employer Identification No.)

720 Pennsylvania Drive

Exton, Pennsylvania 19341

(Address of principal executive offices) (Zip Code)

(610) 646-9800

(Registrant’s telephone number, including

area code)

Check the appropriate box below if the Form 8-K filing is intended

to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written

communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting

material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement

communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement

communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth

company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange

Act of 1934 (§ 240.12b-2 of this chapter).

Emerging

growth company ¨

If an emerging

growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any

new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.01. Completion of

Acquisitions or Dispositions of Assets.

July 21, 2026, Innovative Solutions and Support, Inc. (the “Company”) filed a Current Report on Form 8-K

reporting that on July 21, 2026, the Company entered into and closed the transactions contemplated by that certain Membership Interest

Purchase Agreement (the “Purchase Agreement”) with Sparton Corporation, a Delaware corporation, pursuant to which the Company

acquired all of the issued and outstanding membership interests of Sparton Aydin, LLC, a Delaware limited liability company doing business

as Aydin Displays (“Aydin” or “Acquired Business”).

This

Current Report on Form 8-K/A amends the original Form 8-K to provide the historical financial statements of the Acquired Business

required under Item 9.01(a) of Form 8-K and the pro forma financial information required under Item 9.01(b) of Form 8-K.

Except as set forth herein, this amendment does not amend, modify or update the disclosure contained in the original Form 8-K (including

the exhibits thereto).

Item 9.01. Financial Statements

and Exhibits.

(a)

Financial Statements of Businesses Acquired.

The audited

financial statements of the Acquired Business as of and for the year ended December 31, 2025 together with the Report of Independent

Certified Public Accountant’s Report thereon, and the unaudited financial statements of the Acquired Business as of and for the

six month period ended June 30, 2026, in each case with the accompanying notes, are filed as Exhibit 99.1 to this Current Report

on Form 8-K/A and are incorporated herein by reference.

(b)

Pro Forma Financial Information.

The unaudited

pro forma condensed combined financial statements of the Company and the Acquired Business for the nine months ended June 30, 2026,

and for the year ended September 30, 2025, are included as Exhibit 99.2 to this Current Report on Form 8-K/A and are incorporated

by reference herein.

(d)

Exhibits.

Exhibit No.

Description

23.1

Consent of Grant Thornton LLP.

99.1

Audited

financial statements of the Acquired Business as of and for the year ended December 31, 2025, and unaudited financial statements of

the Acquired Business as of and for the six month period ended June 30, 2026, including notes thereto and Report of Independent

Certified Public Accountant’s Report thereon.

99.2

Unaudited

pro forma condensed combined financial statements of the Company and the Acquired Business for the nine month period ended June 30, 2026,

and for the year ended September 30, 2025.

104

Cover Page Interactive Data File – the cover page XBRL tags are embedded within the inline XBRL document.

SIGNATURE

Pursuant to the requirements of the Securities

Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

INNOVATIVE SOLUTIONS AND SUPPORT, INC.

Date: October 6, 2026

By:

/s/ Jeffrey DiGiovanni

Jeffrey DiGiovanni

Chief Financial Officer

EX-23.1 — EXHIBIT 23.1

EX-23.1

Filename: tm2626969d1_ex23-1.htm · Sequence: 2

Exhibit 23.1

CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We have issued our report dated October 6,

2026 with respect to the financial statements of Sparton Aydin, LLC for the year ended December 31, 2025, included in this Current

Report of Innovative Solutions and Support, Inc. on Form 8-K/A. We consent to the incorporation by reference of said report

in the Registration Statements of Innovative Solutions and Support, Inc. on Forms S-3 (File No. 333-290859 and File No. 333-267595)

and Forms S-8 (File No. 333-163712 and File No. 333-235689).

Philadelphia, Pennsylvania

October 6, 2026

EX-99.1 — EXHIBIT 99.1

EX-99.1

Filename: tm2626969d1_ex99-1.htm · Sequence: 3

Exhibit 99.1

SPARTON AYDIN, LLC

FINANCIAL STATEMENTS

AS OF AND FOR THE YEAR

ENDED DECEMBER 31, 2025 (Audited)

AS OF AND FOR THE SIX

MONTHS ENDED JUNE 30, 2026 (Unaudited)

Sparton Aydin, LLC

INDEX TO FINANCIAL STATEMENTS

Page

Report of Independent Certified Public Accountants

Balance Sheets as of December 31, 2025 (Audited) and June 30, 2026 (Unaudited)

Statements of Operations for the Year Ended December 31, 2025 (Audited) and the Six Months Ended June 30, 2026 (Unaudited)

Statements of Shareholders’ Equity as of December 31, 2025 (Audited) and June 30, 2026 (Unaudited)

Statements of Cash Flows for the Year Ended December 31, 2025 (Audited) and the Six Months Ended June 30, 2026 (Unaudited)

Notes to Financial Statements

8-23

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors

and Stockholders of Innovative Solutions and Support, Inc.

Opinion on the financial statements

We have audited the financial statements

of Sparton Aydin, LLC, a Delaware limited liability company (the “Company”), which comprise the balance sheet as of

December 31, 2025, and the related statements of operations, changes in shareholders’ equity, and cash flows for the year then

ended, and the related notes to the financial statements. In our opinion, the accompanying financial statements present fairly, in all

material respects, the financial position of the Company as of December 31, 2025, and the results of its operations and its cash

flows for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for opinion

We conducted our audit of the financial statements in accordance with

auditing standards generally accepted in the United States of America (US GAAS). Our responsibilities under those standards are further

described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to

be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating

to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of management for the financial statements

Management is responsible for the preparation and fair presentation

of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design,

implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are

free from material misstatement, whether due to fraud or error.

In preparing the financial statements,

management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about

the Company’s ability to continue as a going concern for one year after the date the financial statements are issued.

Auditor’s responsibilities for the audit of the financial

statements

Our objectives are to obtain reasonable assurance about whether the

financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report

that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee

that an audit conducted in accordance with US GAAS will always detect a material misstatement when it exists. The risk of not detecting

a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional

omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood

that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with US GAAS, we:

· Exercise professional judgment and maintain professional skepticism throughout

the audit.

· Identify and assess the risks of material misstatement of the financial statements,

whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on

a test basis, evidence regarding the amounts and disclosures in the financial statements.

· Obtain an understanding of internal control relevant to the audit in order

to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness

of the Company’s internal control. Accordingly, no such opinion is expressed.

· Evaluate the appropriateness of accounting policies used and the reasonableness

of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

· Conclude whether, in our judgment, there are conditions or events, considered

in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period

of time.

We are required to communicate with those charged with governance regarding,

among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters

that we identified during the audit.

/s/ GRANT THORNTON LLP

Philadelphia, Pennsylvania

October 6, 2026

SPARTON AYDIN, LLC

BALANCE SHEETS

(in thousands)

December 31,

June 30,

2025

2026 (Unaudited)

ASSETS

Current assets

Cash and cash equivalents

1,796

1,426

Accounts receivable

2,728

1,987

Contract assets

338

875

Due from Affiliate

5,484

6,391

Inventories

2,916

3,116

Prepaid expenses and other current assets

286

159

Total current assets

13,548

13,954

Goodwill

10,328

Intangible assets, net

3,211

3,004

Property and equipment, net

1,700

1,579

Total assets

28,787

28,865

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

Accounts payable

503

873

Accrued expenses

425

404

Contract liabilities

551

257

Due to Affiliate

1,351

1,391

Income taxes payable

412

549

Deferred income taxes

1,134

1,049

Total liabilities

4,376

4,523

Commitments and contingencies (See Note 11)

Shareholders’ equity

24,411

24,342

Total liabilities and shareholders’ equity

28,787

28,865

The accompanying notes are an integral part of

these financial statements.

SPARTON AYDIN, LLC

STATEMENTS OF OPERATIONS

(in thousands)

December 31, 2025

Six Months Ended

June 30, 2026 (unaudited)

Net sales

16,330

7,302

Cost of sales

11,884

5,832

Gross profit

4,446

1,470

Operating expenses:

Research and development

897

517

Selling, general and administrative

2,388

970

Total operating expenses

3,285

1,487

Income (loss) and income (loss) before taxes

1,161

(17

)

Income tax expense

279

Net income (loss)

882

(69

)

The accompanying notes are an integral part of

these financial statements.

SPARTON AYDIN, LLC

STATEMENTS OF SHAREHOLDERS’ EQUITY

(in thousands)

Total

shareholders’

equity

Balance, December 31, 2024 (Unaudited)

$ 23,529

Net income

882

Balance, December 31, 2025

$ 24,411

Net loss

(69 )

Balance, June 30, 2026 (Unaudited)

$ 24,342

The accompanying notes are an integral part of

these financial statements

SPARTON AYDIN, LLC

STATEMENTS OF CASH FLOWS

(in thousands)

December 31, 2025

Six Months ended

June 30, 2026 (unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income (loss)

$ 882

(69 )

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

619

338

Deferred income taxes

(131 )

(85 )

(Increase) decrease in:

Accounts receivable

(222 )

741

Inventories

(1,330 )

(200 )

Contract assets

103

(537 )

Due from affiliate

756

(907 )

Prepaid expenses and other current assets

(228 )

127

Increase (decrease) in:

Accounts payable

(52 )

370

Accrued expenses

(534 )

(21 )

Contract liabilities

114

(294 )

Due to affiliate

Income taxes payable

412

137

Net cash provided by operating activities

$ 457

(360 )

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment

(99 )

(10 )

Net cash (used in) investing activities

$ (99 )

(10 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Net cash (used in) provided by financing activities

$ -

Net increase (decrease) in cash and cash equivalents

358

(370 )

Cash and cash equivalents, beginning of year

1,438

1,796

Cash and cash equivalents, end of year

$ 1,796

1,426

The accompanying notes are an integral part of

these financial statements.

SPARTON AYDIN, LLC

NOTES TO FINANCIAL STATEMENTS

1. Background

Sparton Aydin,LLC, a Delaware limited liability company doing business

as Aydin Displays (“Aydin” or the “Company”) has designed and manufactured ruggedized displays to meet the most

critical military spec environments in ground vehicles, naval, and airborne systems. With thousands of ruggedized displays deployed throughout

the world, Aydin is aligned with the needs of its military customers and supporting America’s defense base. Aydin is a vertically

integrated designer and manufacturer of ruggedized displays for mission-critical aerospace, defense, and industrial applications. Aydin

operates as a one-stop shop, providing extensive in-house capabilities across design, engineering, production, and sustainment (e.g.,

spares and repairs) ensuring quality, speed, and control throughout the entire product lifecycle. Aydin delivers fully customized, MIL-STD-certified

displays ranging from 10” to 65” across a variety of use cases such as ground, naval surface and subsurface programs, airborne

systems, and air traffic control towers.

July 21, 2026, Innovative Solutions and Support, Inc. (the “Acquirer”) entered into and closed the transactions

contemplated by that certain Membership Interest Purchase Agreement (the “Purchase Agreement”) with Sparton Corporation,

a Delaware corporation (“Seller”), pursuant to which the Acquirer acquired all of the issued and outstanding membership interests

of Aydin, a wholly owned subsidiary of Elbit Systems of America, LLC (“Elbit”) “(the (“Acquisition”)’.

2. Concentrations

Major Customers

For the year ended December 31, 2025 and for the six months ended

June 30, 2026 (unaudited), the Company derived 72% and 76%, respectively, of total sales from five customers, although not all the

same customers in each period. Accounts receivable and contract assets related to the Company’s top five customers were $2.9 million

and $3.2 million as of June 30, 2026 (unaudited) and December 31, 2025, respectively.

Major Suppliers

The Company buys several of its components from sole source suppliers.

Although there are a limited number of suppliers of particular components, management believes other suppliers could provide similar

components on comparable terms.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration

of credit risk consist principally of cash balances and accounts receivable. The Company’s customer base consists principally of

companies within the Department of Defense industry. The Company requests advance payments and/or letters of credit from customers that

it considers to be significant credit risks. The Company maintains a cash balance with a U.S. financial institution, in which the balance

exceeds the FDIC insured limit of $250,000. As of December 31, 2025 and June 30, 2026 (unaudited), the Company’s

cash balance held at the financial institution exceeded the FDIC limit. The Company has not experienced losses on this account and management

believes the Company is not exposed to significant risks on such account.

3. Summary

of Significant Accounting Policies

Principles of Presentation

As of and for the periods presented, the Company had no subsidiaries

or entities requiring consolidation. Accordingly, the accompanying financial statements include only the accounts of the Company.

Use of Estimates

The financial statements of the Company have been prepared in accordance

with accounting principles generally accepted in the United States of America (“GAAP”), which require management to make estimates

and assumptions that affect the amounts reported in the financial statements. Actual results could differ from those estimates. Estimates

are used in accounting for, among other items, valuation of tangible and intangible assets acquired, evaluation of allowances for credit

losses accounts, inventory write-downs, product warranty cost liabilities, the useful lives of long-lived assets for depreciation and

amortization, the recoverability of long-lived assets, evaluation of goodwill and indefinite-lived intangible assets impairment and contingencies.

Estimates and assumptions are reviewed periodically, and the effects of changes, if any, are reflected in the statements of operations

in the period they are determined.

Intangible Assets

Intangible assets acquired in a business combination are recognized

at fair value using generally accepted valuation methods deemed appropriate for the type of intangible asset acquired and are reported

separately from any goodwill recognized.

Intangible assets with a finite life are amortized over their estimated

useful life and are reported net of accumulated amortization. They are assessed for impairment in accordance with the Company’s

policy on assessing long-lived assets for impairment described below.

The Company reviews long-lived assets for impairment whenever events

or changes in circumstances indicate that the carrying value of an asset may not be recoverable. In reviewing for impairment, the Company

first complete a qualitative assessment at the lowest level of identifiable cash flows for their long-lived assets (excluding goodwill).

If there are indicators of impairment from the qualitative assessment, a quantitative analysis is performed where the carrying value of

such assets is compared to the undiscounted future pre-tax cash flows expected from the use of the assets and their eventual disposition.

If such cash flows are not sufficient to support the asset’s (or asset group’s) recorded value, an impairment loss may be

recognized if the estimated fair value of the asset (or asset group) is less than the respective carrying value. The determination of

future cash flows as well as the estimated fair value of long-lived and intangible assets involves significant estimates and judgment

on the part of management. The Company estimates and assumptions may prove to be inaccurate due to factors such as changes in economic

conditions, expected asset utilization levels, their business activity levels, or other changing circumstances. In support of the Company’s

review for indicators of impairment, they perform a review of their long-lived assets at the lowest level of identifiable cash flows to

conclude whether indicators of impairment exist associated with their long-lived assets. There were no indications of impairment associated

with the Company’s long-lived assets for the year ended December 31, 2025 or the six months ended June 30, 2026 (unaudited).

Goodwill

Goodwill represents the future economic benefit arising from other

assets acquired that could not be individually identified and separately recognized. The recorded amounts of goodwill from business combinations

are based on management’s best estimates of the fair values of assets acquired and liabilities assumed at the date of acquisition.

Goodwill is assigned to the reporting units that are expected to benefit from the synergies of the business combination that generated

the goodwill. The Company’s goodwill impairment test is performed at the reporting unit level. Reporting units are determined based

on an evaluation of the Company’s operating segments and the components making up those operating segments. Based on this evaluation,

the Company has concluded that it has one reporting unit, which is at the entity level, and all goodwill is assigned to that reporting

unit.

The Company may first assess qualitative factors in order to determine

whether goodwill and indefinite-lived intangible assets are impaired. If through the qualitative assessment it is determined that it is

more likely than not that goodwill and indefinite-lived intangible assets are not impaired, no further testing is required. If it is determined

more likely than not that goodwill and indefinite-lived intangible assets are impaired, or if the Company elects not to first assess qualitative

factors, the Company’s impairment testing continues with the estimation of the fair value of the reporting unit using a combination

of a market approach and an income (discounted cash flow) approach, at the reporting unit level. Estimating the fair value of reporting

unit requires significant management judgment with respect to revenue and expense growth rates, changes in working capital and the selection

and use of an appropriate discount rate. The estimates of the fair value of reporting units are based on the best information available

as of the date of the assessment. The use of different assumptions would increase or decrease estimated discounted future operating

cash flows and could increase or decrease an impairment charge. The Company’s management uses its judgment in assessing whether

assets may have become impaired between annual impairment tests. Indicators such as adverse business conditions, economic factors

and technological change or competitive activities may signal that an asset has become impaired.

If the Company determines that it is more likely than not that the

fair value of the reporting unit is below the carrying amount as part of its qualitative assessment, a quantitative assessment of goodwill

is required. In the quantitative evaluation, the fair value of the reporting unit is determined and compared to the carrying value. If

the fair value is greater than the carrying value, then the goodwill is deemed not to be impaired and no further action is required. If

the fair value is less than the carrying value, goodwill is considered impaired and a charge is reported as impairment of goodwill in

the statements of operations. Accordingly, no goodwill impairment was recognized in the financial statements for the year ended December 31,

2025 or the six months ended June 30, 2026 (unaudited).

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with

an original maturity of three months or less from the time they are acquired to be cash equivalents. The Company had $1.8 million and

$1.4 million in cash as of December 31, 2025 and June 30, 2026 (unaudited), respectively. The Company had no cash equivalents

as of December 31, 2025 and June 30, 2026 (unaudited).

Accounts Receivable

The Company records receivables derived from contracts with customers

at net realizable value and they generally do not bear interest. An allowance for estimated uncollectible accounts is established if uncollectability

is considered probable. This value may include an allowance for credit losses to reflect any losses anticipated on the accounts receivable

balances, which is charged to the provision for doubtful accounts. When determining uncollectability, the Company considers historical

write-offs by customer, level of past due accounts, and the economic status of the customers. Write-offs are recorded at the time a customer

receivable is deemed uncollectible. The Company had no allowance for credit losses as of December 31, 2025 and as of June 30,

2026 (unaudited).

Inventory

Inventories are stated at a weighted average, net of write-downs for

excess and obsolete inventory, and consists of the following (in thousands):

Year Ended

December 31,

Six Months Ended

June 30,

2025

2026 (unaudited)

Raw materials

2,261

2,367

Work-in-process

568

622

Finished goods

127

2,916

3,116

Property and Equipment, net

Property, plant and equipment is recorded at cost. Depreciation and

amortization is generally provided on the straight-line method over the estimated useful lives of the various assets. Major additions

and improvements are capitalized, while maintenance and repairs that do not improve or extend the life of assets are charged to expense

as incurred.

The Company’s property, plant and equipment is generally depreciated

over the following estimated useful lives:

· Buildings and improvements are depreciated over estimated lives of five to

thirty-nine years.

· Furniture and office equipment is depreciated over estimated lives of three

to fifteen years.

· Computer equipment is depreciated over an estimated life of three to five

years.

· Equipment is depreciated over estimated lives of three to ten years.

Revenue Recognition

The Company enters into sales arrangements with customers that, in

general, provide for the Company to design, develop, manufacture and deliver ruggedized flat-panel display systems and peripherals that

meet the most critical military spec environments in ground vehicles, naval and airborne systems.

Revenue from Contracts with Customers

The Company accounts for revenue in accordance with ASC 606, Revenue

from Contracts with Customers (“ASC 606”). The core principle of ASC 606 is that an entity recognizes revenue when a customer

obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects

to be entitled to receive in exchange for these goods or services. To achieve this core principle, the Company applies the following five

steps:

1) Identify the contract with a customer

The Company’s contracts with its customers typically take the

form of a purchase order issued to the Company by its customers and, to a lesser degree, in the form of a purchase order issued in connection

with a formal contract executed with a customer. In addition, the Company enters into fixed-price contracts, in which the Company agrees

to perform the specified work for a pre-determined price. The contractual terms of the fixed price contracts vary in period of performance,

however they often contain a termination for convenience clause which results in the Company treating these contracts as day-to-day under

ASC 606. For purposes of accounting for revenue under ASC 606, a contract with a customer exists when (i) the Company enters into

an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies

the payment terms related to those goods or services, (ii) the contract has commercial substance and, (iii) the Company determines

that collection of substantially all consideration for goods or services that are transferred is probable based on the customer’s

intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention

to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer,

published credit and financial information pertaining to the customer.

2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based

on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit

from the good or service either on its own or together with other resources that are readily available from third parties or from the

Company, and are distinct in the context of the contract, whereby the transfer of the goods or services is separately identifiable from

other promises in the contract. Most of the Company’s revenue is derived from purchases under which we provide a specific product

or service and, as a result, there is only one performance obligation. In the event that a contract includes multiple promised goods or

services, such as an Engineering Development Contract (“EDC”) which includes both engineering services and a resulting product

shipment, the Company must apply judgment to determine whether promised goods or services are capable of being distinct in the context

of the contract. In the event that a contract includes multiple promised goods or services, such as an EDC contract which includes both

engineering services and a resulting product shipment, the Company must apply judgment to determine whether promised goods or services

are capable of being distinct in the context of the contract. In these cases, the Company considers whether the customer could, on its

own, or together with other resources that are readily available from third parties, produce the physical product using only the output

resulting from the Company’s completion of engineering services. If the customer cannot produce the physical product, then the promised

goods or services are accounted for as a combined performance obligation.

3) Determine the transaction price

The transaction price is determined based on the consideration to which

the Company will be entitled in exchange for transferring goods or services to the customer. To the extent the transaction price includes

variable consideration, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing

either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration

is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative

revenue under the contract will not occur.

4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire

transaction price is allocated to the single performance obligation. For contracts with multiple performance obligations, the Company

determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling

price is not observable through past transactions, the Company estimates the standalone selling price by taking into account available

information such as market conditions as well as the cost of the goods or services and the Company’s normal margins for similar

performance obligations.

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations either over time or at

a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised good or

service to a customer. Product sales revenue is recognized point-in-time when the product is sold and shipped to the customer. Services

revenues are recognized over time upon the completion of the identified performance obligations. Historically, the Company has also recognized

revenue from EDC and long-term production contracts and are recognized over time using an input measure (e.g., costs incurred to date

relative to total estimated costs at completion) to measure progress, as this is determined to be the best measure of the Company's progress

toward satisfying the performance obligation. Contract costs include material, components and third-party avionics purchased from suppliers,

direct labor, and overhead costs.

6) Contract Estimates

Accounting for performance obligations in long-term contracts that

are satisfied over time involves the use of various techniques to estimate progress towards satisfaction of the performance obligation.

The Company typically measures progress based on costs incurred compared to estimated total contract costs. Contract cost estimates are

based on various assumptions to project the outcome of future events that often span more than a single year. These assumptions include

the amount of labor and labor costs, the quantity and cost of raw materials used in the completion of the performance obligation and the

complexity of the work to be performed.

As a significant change in one or more of these estimates could affect

the profitability of our contracts, we review and update our contract-related estimates regularly. We recognize adjustments in estimated

profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is

recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance are recognized using

the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, we recognize

the total loss in the quarter it is identified.

The impact of adjustments in contract estimates on our operating earnings

can be reflected in either operating costs and expenses or revenue. Therefore, no adjustment on any contract was material to our financial

statements for the calendar year ended December 31, 2025 and the six months ended June 30, 2026 (unaudited).

Contract Balances

Contract assets consist of the right to consideration in exchange for

product offerings that we have transferred to a customer under the contract. Contract liabilities primarily relate to consideration received

in advance of performance under the contract. The following table reflects the Company’s contract assets and liabilities (in thousands):

Contract

Assets

Liabilities

December 31, 2024 (unaudited)

440,665

437,284

Amount transferred to receivables from contract assets

(440,665

)

Contract asset additions

337,703

Performance obligations satisfied during the period that were included in the contract liability balance at the beginning of the period

Increases due to invoicing prior to satisfaction of performance obligations

113,798

December 31, 2025

337,703

551,082

Amount transferred to receivables from contract assets

(337,703

)

Contract asset additions

(unaudited)

875,234

Performance obligations satisfied during the period that were included in the contract liability balance at the beginning of the period (unaudited)

(294,151

)

Increases

due to invoicing prior to satisfaction of performance obligations (unaudited)

June 30, 2026 (unaudited)

875,234

256,931

* Due to the fact that our fixed price contracts are treated as day-to-day

contracts due to the inclusion of termination for convenience clauses, there are no remaining unsatisfied performance obligations at period

end to disclose under ASC 606.

The balances for Accounts receivable were $2.9 million, $3.7 million

and $3.6 million for the year ended December 31, 2024 (unaudited), December 31, 2025 (unaudited) and the six months ended June 30,

2026 (unaudited), respectively.

Income Taxes

Income taxes are recorded in accordance with ASC Topic 740, “Income

Taxes” (“ASC Topic 740”), which utilizes a balance sheet approach to provide for income taxes. Under this method, the

Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis

of the Company’s assets, liabilities and expected benefits of utilizing net operating losses (“NOL”) and tax credit

carry-forwards. The impact on deferred taxes of changes in tax rates and laws, if any, are applied to the years during which temporary

differences are expected to be settled and are reflected in the financial statements in the period of enactment. At the end of each interim

reporting period, the Company prepares an estimate of the annual effective income tax rate and applies that annual effective income tax

rate to ordinary year-to-date pre-tax income for the interim period. Specific tax items discrete to a particular quarter are recorded

in income tax expense for that quarter. The estimated annual effective tax rate used in providing for income taxes on a year-to-date basis

may change in subsequent periods.

The accounting for uncertainty in income taxes requires a more likely

than not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return.

The Company records a liability for the difference between the (i) benefit recognized and measured for financial statement purposes

and (ii) the tax position taken or expected to be taken on the Company’s tax return. To the extent that the Company’s

assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. The Company

has elected to record any interest or penalties associated with uncertain tax positions as income tax expense.

Research and Development

Total research and development expense comprises of internally funded

research and development (“R&D”), which is expensed as research and development in the statements of operations. R&D

charges incurred for product design, product enhancements and future product development are expensed as incurred.

Expenses related to engineering and development contracts, which primarily

relate to payroll-related expenses of employees engaged in EDC projects, engineering related product materials and equipment, subcontracting

costs and applicable overhead, which are expensed in cost of goods sold.

Fair Value of Financial Instruments

The net carrying amounts of cash and cash equivalents, accounts receivable

and accounts payable approximate their fair value because of the short-term nature of these instruments. For financial assets and liabilities

measured at fair value on a recurring basis, fair value is the price the Company would receive to sell an asset or pay to transfer a liability

in an orderly transaction with a market participant at the measurement date. A three-level fair value hierarchy prioritizes the inputs

used to measure fair value as follows:

Level 1 — Unadjusted quoted prices

that are available in active markets for the identical assets or liabilities at the measurement date.

Level 2 — Other observable inputs

available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:

· Quoted prices for similar assets or liabilities in active markets;

· Quoted prices for identical or similar assets in non-active markets;

· Inputs other than quoted prices that are observable for the asset or liability;

and

· Inputs that are derived principally from or corroborated by other observable

market data.

Level 3 — Unobservable inputs that

cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined

using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.

As of December 31, 2025 and June 30, 2026 (unaudited), the Company

had no financial assets or liabilities that were accounted for at fair value on a recurring basis.

4. Intangible assets

The Company’s intangible assets other than goodwill are as follows

(in thousands):

As of December 31, 2025

Gross Carrying

Accumulated

Net Carrying

Value

Impairment

Amortization

Value

Customer relationships

$ 3,500

(653 )

$ 2,847

Backlog

490

(490 )

Unpatented Technology

1,639

(1,275 )

364

Total

$ 5,629

(2,418 )

$ 3,211

As of June 30, 2026 (Unaudited)

Gross Carrying

Accumulated

Net Carrying

Value

Impairment

Amortization

Value

Customer relationships

$ 3,502

(723 )

$ 2,777

Backlog

490

(490 )

Unpatented Technology

1,639

(1,412 )

227

Total

$ 5,629

(2,625 )

$ 3,004

Intangible asset amortization expense is amortized as a component of

selling, general and administrative expense and was $0.4 million and $0.2 million for the year ended December 31, 2025 and the six

months ended June 30, 2026 (unaudited), respectively.

The expected future amortization expense related to the customer relationships

and trade name as of December 31, 2025 is as follows (in thousands):

Amortization

Expense

2026

413

2027

231

2028

231

2029

231

2030

231

Thereafter

1,874

Total

3,211

5. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following

(in thousands):

As of December 31,

As of June 30,

2025

2026 (unaudited)

Accounts payable pre-payments

232

108

Prepaid taxes

Dues, services and pre-paid insurance

Total

286

159

6. Property and Equipment

Property and equipment, net consists of the following balances (in

thousands):

As of

December 31, 2025

As of

June 30, 2026 (unaudited)

Computer equipment

$ 4

Buildings and improvements

294

Equipment

2,273

2,230

Property and Equipment, gross

2,518

2,528

Less accumulated depreciation and amortization

(870 )

(984 )

Property and Equipment, net

$ 1,700

1,544

Depreciation related to property and equipment was $0.2 million and

$0.1 million for the year ended December 31, 2025 and the six months ended June 30, 2026 (unaudited), respectively recorded

in cost of goods sold in the accompanying statements of operations.

7. Accrued

Expenses

Accrued expenses consist of the following (in thousands):

As of

December 31,

As of

June 30, 2026

2025

(unaudited)

Warranty

Salary, benefits and payroll taxes

265

266

Bonus accruals

Total

424

404

8. Warranty

The Company offers a one-year warranty on all products, with minor

exceptions based on contract negotiation. The Company carries a warranty reserve that is based on historical warranty expense incurred.

The historical average is calculated on a running eighteen (18) month average of sales and expenses. The average calculation is modified

if some specific issue becomes known at the time it is determined to be feasible.

Warranty cost is recorded as Cost of sales.

Warranty cost and accrual information is as follows (in

thousands):

As of

December 31, 2025

As of

June 30, 2026 (unaudited)

Warranty accrual, beginning of period

$ 46

$ 75

Accrued expense (Adjustment)

Warranty accrual, end of period

$ 75

9. Income Taxes

The components of income taxes are

as follows (in thousands):

As of

December 31, 2025

As of

June 30, 2026 (unaudited)

Current provision

Federal

350

108

State

Total current provision

412

137

Deferred provision

Federal

(119

)

(118

)

State

(14

)

Total deferred provision

(133

)

(85

)

Total current and deferred provision

279

Following is a reconciliation of the statutory federal rate to the

Company’s effective income tax rate (in thousands):

As of

December 31, 2025

As of

June 30, 2026 (unaudited)

Income tax provision (benefit) at the U.S. Federal statutory tax rate of 21%

243

)

State income taxes, net of federal benefit

Effective income tax rate

24.0

(301.4

The deferred tax effect of temporary differences giving rise to the

Company’s deferred tax assets and liabilities consists of the components below (in thousands):

As of December 31,

2025

As of

June 30, 2026 (unaudited)

Non Current

Deferred tax assets:

Reserves and accruals

$ 17

$ 72

Total deferred tax assets

Deferred tax liabilities:

Depreciation and amortization

(1,152 )

(1,120 )

Total deferred tax liabilities

(1,152 )

(1,120 )

Net deferred tax liabilities

$ (1,135 )

$ (1,048 )

The Company had no unrecognized tax benefits (uncertain tax positions)

as of December 31, 2025 or June 30, 2026 (unaudited), and none are expected to be recognized within the next twelve months.

No federal or state net operating loss carryforwards were generated in either period presented.

10. Savings Plan

The Company sponsors a voluntary defined contribution savings plan

covering all employees. The Company made contributions of approximately $0.1 million and $0.1 million for the year ended December 31,

2025 and the six months ended June 30, 2026 (unaudited), respectively.

11. Commitments and Contingencies

Purchase Obligations

A “purchase obligation” is defined as an agreement to purchase

goods or services that is enforceable and legally binding on the Company and that specifies all significant terms, including fixed quantities

to be purchased, fixed price provisions, and the approximate timing of the transaction. These amounts primarily comprise open purchase

order commitments entered into in the ordinary course of business with vendors and subcontractors pertaining to fulfillment of the Company’s

current order backlog.

Product Liability

The Company has product liability insurance of $50,000,000. The Company

has not experienced any material product liability claims.

Legal Proceedings

In the ordinary course of business, the Company is at times subject

to various legal proceedings and claims. As of June 30, 2026 (unaudited) and December 31, 2025, there are no such matters pending.

12. Transactions with Affiliates

Prior to the Acquisition, the Company was wholly owned by Elbit, and

as such, may have received support from Elbit and affiliates in the form of company administrative services. In addition, the Company

supplied products to Elbit under the terms of a supply agreement between the parties. Revenues received under the supply arrangement were

$3.3 million and $1.1 million for the year ended December 31, 2025, and for the six months ended June 30, 2026 (unaudited),

respectively. In addition, the Company incurred certain expenses from Elbit for administrative reimbursement services which are included

in selling, general and administrative in the statement of operations. For the year ended December 31, 2025, and for the six months

ended June 30, 2026 (unaudited), the Company incurred $2.0 million and $0.9 million, respectively.

As of December 31, 2025 and June 30, 2026 (unaudited) the

Company owed Elbit $1.4 million and $1.4 million, respectively which is disclosed as due to affiliate on the Balance Sheet. As of December 31,

2025 and June 30, 2026 (unaudited) the Company is owed from Elbit $5.5 million and $6.4 million, respectively which is disclosed

as due from affiliate on the Balance Sheet.

13. Subsequent Events

The Company has evaluated subsequent events or transactions that occurred

after December 31, 2025 through October 6, 2026, the date which these financial statements were available to be issued and noted that

there were no subsequent events except as it relates to the Acquisition disclosed in Note 1.

EX-99.2 — EXHIBIT 99.2

EX-99.2

Filename: tm2626969d1_ex99-2.htm · Sequence: 4

Exhibit 99.2

UNAUDITED PRO FORMA

CONDENSED COMBINED FINANCIAL STATEMENTS

On July 21, 2026, Innovative

Solutions and Support, Inc. (the “Company” or “IA”) completed the acquisition (the “Acquisition”)

of all of the outstanding equity interests of Sparton Aydin, LLC (“Aydin”) pursuant to a Membership Interest Purchase Agreement

(the “Purchase Agreement”). As a result of the Acquisition, Aydin became a wholly owned subsidiary of the Company. The following

unaudited pro forma condensed combined financial statements of IA present the combination of the historical financial information of IA

and Aydin adjusted to give effect to the Acquisition accounted for under the acquisition method of accounting in accordance with Accounting

Standards Codification 805, Business Combinations (“ASC 805”). The valuations of the assets acquired and liabilities assumed,

and therefore the purchase price allocations, are preliminary and have not yet been finalized as of the date of this filing. As a result

of the foregoing, the pro forma adjustments are preliminary and have been made solely for the purpose of providing unaudited pro forma

combined financial information and the final purchase price allocation and the resulting effect on financial position and results of operations

may differ significantly from the pro forma amounts included herein.

The following tables

and accompanying notes (collectively the “Unaudited Pro Forma Condensed Combined Financial Statements”) present the Company’s

unaudited pro forma condensed combined balance sheet as of June 30, 2026, and unaudited pro forma condensed combined statements of

operations for the nine months ended June 30, 2026, and the year ended September 30, 2025. The information in the tables below

under the heading “Unaudited Pro Forma Condensed Combined Balance Sheet” as of June 30, 2026, gives pro forma effect

to the Acquisition as if it had occurred on June 30, 2026. The “Unaudited Pro Forma Condensed Combined Statements of Operations”

for the nine months ended June 30, 2026, and the year ended September 30, 2025, give pro forma effect to the Acquisition as

if it had occurred on October 1, 2024.

The unaudited pro forma condensed combined

financial information is for informational purposes only and should not be considered indicative of actual results that would have been

achieved had the Acquisition actually been consummated on the dates indicated and does not purport to be indicative of results of operations

as of any future date or for any future period. The Company’s actual financial condition and results of operations may differ significantly

from the pro forma amounts reflected herein due to a variety of factors.

The pro forma transaction

accounting adjustments are based upon currently available information and certain assumptions that the Company’s management believes

are reasonable. The Unaudited Pro Forma Condensed Combined Financial Statements are presented for informational purposes only and are

not intended to present or be indicative of what the results of operations or financial position would have been had the events actually

occurred on the dates indicated, nor are they meant to be indicative of future results of operations or financial position for any future

period or as of any future date. The Unaudited Pro Forma Condensed Combined Financial Statements

do not include any adjustments not otherwise described herein; they do not give effect to

the potential impact of current financial conditions, or any anticipated revenue enhancements, cost savings, operating synergies or dis-synergies

that may result from the Acquisition.

The historical financial

information of the Company being presented in these Unaudited Pro Forma Condensed Combined Financial Statements is derived from the Company’s

unaudited statement of operations for the nine months ended June 30, 2026, and its audited statement of operations for the fiscal

year ended September 30, 2025, which were prepared in accordance with accounting principles generally accepted in the United States

of America (“GAAP”).

The historical financial

information of Aydin is derived from Aydin’s audited financial statements as of and for the year ended December 31, 2025 and

the unaudited financial statements as of and for the nine months ended June 30, 2026, which were prepared in accordance with GAAP

and are presented in the Financial Statements included in Exhibit 99.1 of this Form 8-K/A.

The assumptions and estimates

underlying the unaudited adjustments to the Unaudited Pro Forma Condensed Combined Financial Statements are described in the accompanying

notes, which should be read together with the Unaudited Pro Forma Condensed Combined Financial Statements. In addition, the Unaudited

Pro Forma Condensed Combined Financial Statements should be read in conjunction with the following:

The Company’s Annual Report on Form 10-K for the year ended September 30, 2025, filed with the SEC on December 23, 2025;

The Company’s Quarterly Report on Form 10-Q for the period ending June 30, 2026, filed with the SEC on August 13, 2026;

Aydin’s audited Financial Statements as of December 31, 2025, included in Exhibit 99.1 of this Form 8-K/A;

Aydin’s unaudited Financial Statements as of June 30, 2026, and for the six months ended June 30, 2026, included in Exhibit 99.1 of this Form 8-K/A; and

Aydin’s unaudited financial information for the three months ended December 31, 2025 (used to determine the results of operations for the nine months ended June 30, 2026) not included in this Form 8-K/A.

The Company has a fiscal year end of September 30

and Aydin’s audited Financial Statements are presented as of and for the year ended December 31. The Unaudited Pro Forma Condensed

Combined Statements of Operations for the nine months ended June 30, 2026, and the year ended September 30, 2025, present the

combination of financial information of the Company and Aydin, after giving effect to the Acquisition described in the accompanying notes.

Within the Unaudited Pro Forma Condensed Combined

Statement of Operations for the nine months ended June 30, 2026, the reporting periods of Aydin and the Company have been aligned.

The Unaudited Pro Forma Condensed Combined Statement of Operations for the nine months ended June 30, 2026, contains the Company’s

results of operations for the nine months ended June 30, 2026, and Aydin’s results of operations for the nine months ended

June 30, 2026.

Due to the alignment of Aydin’s reporting

period to the Company’s reporting period in the Unaudited Pro Forma Condensed Combined Statement of Operations for the nine months

ended June 30, 2026, Aydin’s statement of operations for the nine months ended June 30, 2026, is included in the Unaudited

Pro Forma Condensed Combined Statements of Operations for both the nine months ended June 30, 2026, and the year ended September 30,

2025. Aydin’s statement of operations for the three months ending December 31, 2025, were $5,539,980 resulting in net

sales in excess of expenses for the three months ending December 31, 2025, of $457,196.

INNOVATIVE SOLUTIONS

AND SUPPORT, INC.

UNAUDITED PRO FORMA

CONDENSED COMBINED BALANCE SHEET

As of June 30,

2026

(U.S. Dollars)

(Historical)

Aydin

(Historical)

Transaction

Accounting

Adjustments

Pro Forma

Combined

ASSETS

Current assets

Cash and cash equivalents

10,694,977

1,426,000

(1,426,000

)

(b)

10,694,977

Accounts receivable

15,984,217

1,987,000

17,971,217

Contract assets

1,735,266

875,000

2,610,266

Due from Affiliate

6,391,000

(6,391,000

)

(b)

Inventories

32,084,294

3,116,000

35,200,294

Prepaid expenses and other current assets

3,931,931

159,000

4,090,931

Total current assets

64,430,685

13,954,000

(7,817,000

)

(b)

70,567,685

Goodwill

15,773,104

10,328,000

(1,470,509

)

(a), (b)

24,630,595

Intangible assets, net

46,032,372

3,004,000

6,766,000

(a), (b)

55,802,372

Property and equipment, net

20,682,675

1,579,000

22,261,675

Deferred income taxes

452,070

Other assets

586,248

Total assets

147,957,154

28,865,000

(2,521,509

)

(a), (b)

174,300,645

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

Current portion of long-term debt, net

5,642,850

Accounts payable

9,816,404

873,000

10,689,404

Accrued expenses

4,863,119

404,000

5,267,119

Contract liabilities

1,371,909

257,000

1,628,909

Due to Affiliate

1,391,000

(1,391,000

)

(b)

Income taxes payable

549,000

(549,000

)

(b)

Deferred income taxes

1,049,000

(1,049,000

)

(b)

Total current liabilities

21,694,282

4,523,000

(2,989,000

)

(b)

23,228,282

Long-term debt, net

48,669,107

24,500,000

(a)

73,169,107

Other liabilities

396,497

Total liabilities

70,759,886

4,523,000

21,511,000

(a), (b)

96,793,886

Commitments and contingencies (See Note 7)

Shareholders’ equity

Preferred stock, 10,000,000 shares authorized, $.001 par value, of which 200,000 shares are authorized as Class A Convertible stock. No shares issued and outstanding at June 30, 2026 and September 30, 2025

Common stock, $.001 par value: 75,000,000 shares authorized, 18,237,353 and 17,970,453 issued at June 30, 2026 and September 30, 2025, respectively

17,898

Additional paid-in capital

40,363,111

24,342,000

(24,032,509

)

(b)

40,672,602

Retained earnings

40,277,231

Treasury stock, at cost, 339,644 shares at June 30, 2026 and at September 30, 2025, respectively

(3,460,972

)

(3,460,972

)

Total shareholders’ equity

77,197,268

24,342,000

(24,032,509

)

(b)

77,506,759

Total liabilities and shareholders’ equity

147,957,154

28,865,000

(2,521,509

)

(a), (b)

174,300,645

INNOVATIVE SOLUTIONS

AND SUPPORT, INC.

UNAUDITED PRO FORMA

CONDENSED COMBINED STATEMENT OF OPERATIONS

For the Nine Months

Ended June 30, 2026

(U.S. Dollars)

(Historical)

Aydin

(Historical)

Transaction

Accounting

Adjustments

Pro Forma

Combined

Net sales

Product

45,391,826

11,858,142

57,249,968

Services

25,512,267

983,838

26,496,105

Total net sales

70,904,093

12,841,980

83,746,073

Cost of sales

Product

22,436,958

9,405,732

434,500

(c), (d)

32,277,190

Services

11,340,314

655,659

11,995,973

Total cost of sales

33,777,272

10,061,391

434,500

(c)

44,273,163

Gross profit

37,126,821

2,780,589

(434,500

)

(c),

39,472,910

Operating expenses:

Research and development

4,994,643

766,906

5,761,549

Selling, general and administrative

14,867,731

1,429,107

475,750

c, (e), (g)

16,772,588

Total operating expenses

19,862,374

2,196,013

475,750

c, (e), (g)

22,534,137

Operating income

17,264,447

584,576

(910,250

)

(c), (e), (f), (h)

16,938,773

Interest expense

(2,022,004

)

(1,414,875

)

(h)

(3,436,879

)

Interest income

13,408

Other income

64,100

Income (loss) before income taxes

15,319,951

584,576

(2,325,125

)

(c), (e), (f), (g)

(h,)

13,579,402

Income tax expense (benefit)

3,337,473

52,000

(500,527

)

(c), (e), (f), (g)

, (h)

2,888,946

Net income (loss)

11,982,478

532,576

(1,824,598

)

(c), (e), (f), (g)

, (h)

10,690,456

Earnings per share:

Net income - basic

0.67

(i)

0.60

Net income - diluted

0.66

(i)

0.59

Weighted average shares outstanding - basic

17,792,981

Weighted average shares outstanding - diluted

18,212,038

INNOVATIVE SOLUTIONS

AND SUPPORT, INC.

UNAUDITED PRO FORMA

CONDENSED COMBINED STATEMENT OF OPERATIONS

For the Year Ended

September 30, 2025

(U.S. Dollars)

(Historical) for

the Year Ended

Spetember 30,

2025

Aydin

(Historical) for

the year ended

December 31,

2025

Transaction

Accounting

Adjustments

Pro Forma

Combined

Net sales

Product

54,080,207

15.560.636

69,640,843

Services

30,216,682

769,364

30,986,046

Total net sales

84,296,889

16,330,000

100,626,889

Cost of sales

Product

27,448,167

11.370.316

579,333

(c)

39,397,816

Services

16,336,841

513,684

16,805,525

Total cost of sales

43,785,008

11,884,000

579,333

(c)

56,248,341

Gross profit

40,511,881

4,446,000

(579,333

)

(c)

44,378,548

Operating expenses:

Research and development

3,992,086

897,000

4,889,086

Selling, general and administrative

16,447,806

2,388,000

1,061,833

(c), (e), (f), (g)

19,897,639

Total operating expenses

20,439,892

3,285,000

1,061,833

(c), (f), (g)

24,786,725

Operating income

20,071,989

1,161,000

(1,641,166

)

(c), (f), (g)

19,591,823

Interest expense

(1,725,205

)

(1,886,500

)

(h)

(3,611,705

)

Interest income

18,943

Other income

1,585,735

Income before income taxes

19,951,462

1,161,000

(3,527,666

)

(c), (e), (f), (g), (h)

17,584,796

Income tax expense (benefit)

4,323,802

279,000

(749,920

)

(c), (e), (f), (g), (h)

3,847,882

Net income

15,627,660

882,000

(2,772,746

)

(c), (e), (f), (g), (h)

13,736,914

Earnings per share:

Net income - basic

0.89

(i)

0.78

Net income - diluted

0.88

(i)

0.77

Weighted average shares outstanding - basic

17,572,980

Weighted average shares outstanding - diluted

17,829,033

INNOVATIVE SOLUTIONS

AND SUPPORT, INC.

NOTES TO UNAUDITED

PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

1. Description of the Transaction

On July 21, 2026, Innovative Solutions

and Support, Inc. (the “Company” or “IA”) completed the acquisition (the “Acquisition”) of all

of the outstanding equity interests of Spartan Aydin, LLC (“Aydin”) pursuant to that certain Membership Interest Purchase

Agreement (the “Purchase Agreement”). As a result of the Acquisition, Aydin became a wholly owned subsidiary of the Company.

As previously disclosed, the aggregate consideration payable under the Purchase Agreement consisted of a cash payment at closing of $24,500,000,

subject to customary adjustments for working capital and transaction expenses.

2. Basis of Presentation

The unaudited pro forma condensed combined financial information has

been prepared in accordance with Article 11 of Regulation S-X to reflect the Acquisition. The unaudited pro forma condensed combined

financial information presents the pro forma financial condition and results of operations of Aydin and the Company based upon the historical

financial information of Aydin after giving effect to the Acquisition and related adjustments set forth in the notes to the unaudited

pro forma condensed combined financial information.

The unaudited pro forma condensed combined financial

information does not reflect any management adjustments for expected effects of the Acquisition and the other transactions contemplated

by the Purchase Agreement, including any cost savings from potential operating efficiencies, or associated costs incurred to achieve such

savings, and for synergies that are expected to result from the Acquisition; nor does it include any costs associated with integration

activities resulting from the Acquisition to the extent they arise. However, such costs could affect the Company following the closing

of the Acquisition in the period the costs are incurred.

The unaudited pro forma condensed combined balance

sheet as of June 30, 2026, gives effect to the Acquisition as if it had occurred on June 30, 2026.

The unaudited pro forma condensed combined statements

of operations for the nine months ended June 30, 2026, gives effect as if it occurred on October 1, 2025. For year ended September

30, 2025, gives effect as if occurred on October 1, 2024.

The Unaudited Pro Forma Condensed Combined Financial

Statements have been prepared using the acquisition method of accounting in accordance with ASC 805 with the Company treated as the accounting

acquirer. As of the date of this Form 8-K/A to which the Unaudited Pro Forma Condensed Combined Financial Statements are attached,

the Company has not completed the detailed valuation procedures necessary to finalize the required estimated fair values and estimated

lives of the assets acquired, the estimated fair values of the liabilities assumed, and the related allocation of the purchase price.

The fair values and purchase price allocation contained in these statements are preliminary and the Company estimated the fair values

as presented in the pro forma financial information using commonly accepted valuation methodologies. The Company is in the process of

completing a formal valuation process. The valuation of acquired assets and assumed liabilities involves significant assumptions, certain

risks, and various uncertainties, and actual results may differ materially from those estimates. The final allocation of the purchase

price will be determined after completion of an analysis to determine the estimated fair value of the assets acquired, liabilities assumed,

and associated tax adjustments; the analysis is expected to be completed by the end of the calendar year. Accordingly, the final acquisition

accounting adjustments may be materially different from the unaudited pro forma adjustments described in these notes to the Unaudited

Pro Forma Condensed Combined Financial Statements.

3. Pro Forma Adjustments

Generally, the adjustments in each of the statements presented above

represent the following: (i) adjustments of the historical net book values of the assets acquired and liabilities assumed to estimated

fair value and the associated income statement effects, such as revised amortization expense as a result of the fair value adjustments

and changes to estimated useful lives; (ii) the impact of the purchase price of the acquisition, and the associated income statement

effects, such as incremental interest expense; (iii) adjustments to the historical financial statements of Aydin in order to present

Aydin’s financial statements in conformity with the Company’s accounting policies; (iv) integration and transaction costs,

and (v) consideration of the income tax implications of the pro forma adjustments. The specific adjustments to the unaudited pro

forma condensed combined financial information are included in the notes presented below.

The transaction

accounting adjustments are based on the Company’s preliminary estimates and assumptions that are subject to change. The following

adjustments have been reflected in the Unaudited Pro Forma Condensed Combined Financial Statements:

(a) Cash

Consideration – Purchase Price

Reflects

cash consideration of $24,500,000 paid for the acquired assets, which were funded from the Company’s Delayed Draw Term Loan (DDTL)

and the acquired assets at their preliminary estimated fair values.

(b) Aydin’s

Historical Excluded accounts

Reflects the

elimination of Aydin’s historical assets and liabilities excluded from the Acquisition

and Aydin’s historical members’ capital and accumulated earnings.

(c)

Aydin’s Historical Amortozation – Amortization Expense

Related to Historical

Reflects the adjustments

to remove historical amortization expenses 205,500 and $274,000 for the nine months ended June 30, 2026, and for the year ended

September 30, 2025, respectively included in cost of goods sold and $104,250; $139,000 for the nine months ended June 30, 2026,

and for the year ended September 30, 2025, respectively included in selling, general and administrative.

(d)

Cost of Sales – Amortization

Expense Related to acquired Backlog Revenue

Reflects the adjustments

to record amortization expenses based on the straight-line method of $640,000 and $853,333 for the nine months ended June 30, 2026,

and for the year ended September 30, 2025, respectively. The amortization expense is related to the fair value of the identifiable

intangible assets, which are backlog revenues. The fair value of the backlog revenue is estimated at $1,280,000. The estimated useful

life of customer relationships is 1.5 years.

(e)

Selling, General and Adminstrative – Amortization Expense Related

to acquired Customer Relationships

Reflects the adjustments

to record amortization expenses based on the straight-line method of $466,500 and $622,000 for the nine months ended June 30, 2026,

and for the year ended September 30, 2025, respectively. The amortization expense is related to the fair value of the identifiable

intangible assets, which are customer relationships. The fair value of the customer relationships is estimated at $6,220,000. The estimated

useful life of customer relationships is 10 years.

The estimated fair

value of the acquired customer relationships is based on a variation of the income valuation approach and is determined using the multi-period

excess earnings method, which is a variation of the discounted cash flow method that quantifies value based on after-tax residual cash

flows generated by the intangible asset. Key estimates and assumptions used in this model are projected revenues and expenses related

to the asset and a risk-adjusted discount rate used to calculate the present value of the future expected cash inflows from the asset.

(f)

Selling, General and Administrative – Transaction Costs

For the year ended

September 30, 2025, there is an adjustment to record the transaction costs of $427,500 to be incurred by the Company and the tax

benefit related to this adjustment is $91,485 for the year ended September 30, 2025.

(g)

Selling, General and Administrative – Amortization Expense Related

to acquired Tradename

Reflects the adjustments

to record amortization expenses based on the straight-line method of $113,500 and $151,333 for the nine months ended June 30, 2026,

and for the year ended September 30, 2025, respectively. The amortization expense is related to the fair value of the identifiable

intangible assets, which is the tradename. The fair value of the tradenames is estimated at $2,270,000. The estimated useful life of

the tradename is 15 years.

(h)

Interest Expense – Delayed Draw Term Loan

Reflects the adjustments

to record the recognition of new interest expense related to the Delayed Draw Term Loan. The adjustment for the nine months ended June 30,

2026 and for the year ended September 30, 2025 is $1,414,875 and $1,886,500, respectively.

The Delayed Draw Term Loan bears interest

at the Company’s option at either:

1. the Alternate Base Rate plus an applicable margin, or

2. the Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin.

The Alternate Base Rate is defined as the highest of (a) the Prime

Rate, (b) the Federal Reserve Bank of New York rate for overnight funds plus 0.50%, and (c) the Adjusted Term SOFR Rate for

a one-month period plus 1.00%, with a minimum rate of 1.00% per annum.

The Adjusted Term SOFR Rate is the Term SOFR Rate plus 0.10%.

An applicable margin is determined based on the Company’s Total Net

Leverage Ratio and ranges from 0.75% to 1.75% for Alternate Base Rate loans and from 1.75% to 2.75% for Adjusted Term SOFR Rate loans.

The Delayed Draw Term Loan requires quarterly principal payments equal

to 2.50% of the original aggregate principal amount commencing with the first scheduled payment date after January 18, 2026, with

the remaining balance due on the Maturity Date.

(i)

Earnings Per Share

The unaudited pro forma combined basic and diluted earnings per share

calculations are based on the unaudited pro forma combined net income of the combined business and the weighted average outstanding shares

of the Company for the nine months ended June 30, 2026 and for the year ended September 30, 2025.

4. Preliminary Estimated Allocation of Purchase Price

The following table summarizes the estimated,

preliminary fair value of the assets acquired and the liabilities assumed as presented in the pro forma condensed combined balance sheet

above, as of June 30, 2026 (unaudited)

Accounts receivable

1,745,000

Inventory

3,530,000

Property, plant, and equipment

1,567,000

Intangible assets

9,770,000

Other assets

460,500

Total identifiable assets

$ 17,072,500

Accounts payable

1,183,000

Other liabilities

246,991

Total liabilities assumed

$ 1,429,991

Net identifiable assets acquired

$ 15,642,509

Goodwill

8,857,491

Net Assets Acquired

24,500,000

The above purchase price allocation is preliminary and subject to revision

as additional information about the fair value of individual assets and liabilities becomes available. The preliminary measurement of

receivables, inventory, property, plant, and equipment, intangible assets, goodwill, deferred income taxes, and other assets and liabilities

are subject to change. A change in the estimated fair value of the net assets acquired will change the amount of the purchase price allocated

to goodwill. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies

heavily on estimates and assumptions. If actual results are materially different from the assumptions the Company used to determine fair

value of the assets and liabilities acquired, it is possible that adjustments to the carrying values of such assets and liabilities will

have an impact on the Company’s net earnings. In particular, the valuations of customer relationship intangible assets were complex

and required significant judgment. The Company used the multi-period excess earnings method under the income approach to measure the customer

relationships intangible assets. The key assumptions utilized in the valuation include discount rates, revenue growth rates, and profitability

levels of forecasted results. These assumptions are forward-looking and could be affected by future economic and market conditions.

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